Underperforming—not underfunded

Nevada’s higher-education spending is above average, while performance is below

Critics of Gov. Gibbons' suggested budget cuts to the Nevada System of Higher Education (NSHE) have alleged that higher education was already underfunded before the cuts were recommended. These critics believe cutting our "low-budget" universities would devastate them and irreversibly harm the quality of education in this state.

An example is Nevada State Democratic Chairman Sam Lieberman, who recently claimed that the Governor's recommended budget cuts to higher education would "...dismantle Nevada's higher education system beyond repair..."

Such notions are false, as will be demonstrated below. NSHE's real problem, when compared with other institutions across the nation, is not underfunding, but the underperformance of the system's flagship schools.

The University of Texas at Austin is a top-tier, national, doctorate-granting research university where per-pupil funding is roughly equivalent to that at the University of Nevada, Reno (UNR). UT Austin ranks 15th best among top national public universities, has a six-year graduation rate of 79 percent, and produces over 4,000 master, doctoral and professional degree students each year.

UT Austin accomplishes all this while spending a mere $13,560 per student annually, as of 2007. And that sum combines state appropriations, student tuition and fees. Of that sum, students contribute $7,630 in the form of tuition, while the remainder comes from state appropriations. When compared to its peers, UT Austin appears "underfunded." The University of California, Berkeley costs $23,470, UCLA $25,210, Michigan $23,830, Ohio State $19,850 and Wisconsin $16,580. UT Austin provides a level of education U.S. News & World Report ranks in Tier 1, and does it for considerably less than the competition—providing much more "bang for the buck."

Comparing UT Austin to Nevada's flagship universities—UNR and the University of Nevada, Las Vegas (UNLV)—we see no comparable bang for the buck in Nevada. Despite similar funding levels as UT Austin, UNR and UNLV are down in the third and fourth tier, respectively, of national doctorate-granting research universities. Neither university is particularly selective; according to U.S. News and World Report, UNR accepts 88 percent of the students that apply while UNLV accepts 69 percent. Graduation rates after six years are 48 percent for UNR and 41 percent for UNLV.

In-state tuition and fees at UNLV are just $4,431 while UNR charges $4,563. Both tuition rates are lower than the national average by about $1,000 per student. Nevertheless, UNR and UNLV are not underfunded.

The total appropriations, per full-time student in 2007, were $11,435 at UNLV and $13,875 at UNR. This means UNR was better funded than UT Austin—arguably the 15th best public university in the country—by $315 per student. Yet, despite similar funding levels as UT Austin, UNR and UNLV are in the bottom tiers of public research universities.

Contrary to the opinion of many academics, the schools are not underfunded. Rather, tuition rates and government subsidy rates at UNR and UNLV are at the average level of public research universities nationwide. According to a report by the Delta Project titled "Trends in College Spending," the average public research university in 2006 spent $14,058 on education and instruction expenses per student.

Nevada's public research universities spent an average of $14,641 per student—ranking 18th highest in the country.

The problem with NSHE isn't that it is underfunded. It is not. Rather, it is that NSHE appears to have been focusing on jobs for Ph.D.'s, rather than on actually educating and graduating students.

Patrick R. Gibbons is an education policy analyst at the Nevada Policy Research Institute.